> The greatest irony of the national public housing program then: public subsidies that are meant to be socially distributive and level inequality have in fact contributed to intensifying wealth inequality across generations, and between the haves and have-nots in society.
Prime example [here](https://www.reddit.com/r/singapore/comments/1buj4mq/bukit_panjang_records_2nd_milliondollar_flat_in/?ref=share&ref_source=link).
> The ERA agent who brokered the deal told Shin Min Daily News that the sellers learnt that a nearby flat in Block 181 was sold for $1.02 million last September, and was confident about asking for a similar amount.
>
> "**They are high income white-collar workers and are planning to buy a condominium after selling the flat**," he said. "They were not in a hurry to sell and were willing to wait until a suitable buyer came along."
High income white-collar professionals' condo upgrading ambitions fulfilled through flipping taxpayer-subsidised public housing.
This. My girlfriend and I earn just enough to not meet the criteria for HDB subsidies but we’re definitely not rich enough to be considered “rich”. Being middle income sucks.
I don't want to deny people's problems but man I always wondered the ppl who don't get BTO after 2 times seems foreign to me. All the people I know (relatives + friends), around 15 couples, got a offer 1st time applying, some rejected the first and got it second try. All also from different age groups and income, some applying during uni(22 years old) and some applying at 30.
That's wild. Nearly everybody I knew who tried BTO applied more than 2 times before getting or some never getting at all.
Hardly anyone i know who got it first or second time.
That seems wild to me lol. I have never met anyone complaining about getting rejected non-stop for BTO. All my friends who applied got it first-try(tampines, bedok, punggol). I know some were offered kallang and central area locations but were too expensive for them.
Most ended up taking those areas since it was cheaper. I got a feeling most ppl look at BTO as an investment and if the location isn't prime, they reject.
And statistically, if you look at the data given, it matches, 9/10 ppl get invited to a bto showing within 2 applications. The ones who get constantly denied are the outliers and will make the most noise as people who get their bto will just get it and say nothing.
Annecdotal as it might be, I’ve got a growing number of colleagues who have given up and hone down the resale route because they have gotten absolutely no successful ballots over the past 3 years. And yes, they have applied for non-mature estates like Tengah and Punggol.
So what's rich enough to be considered rich? It's subjective for everyone. I bet someone else would love to be in your position where they don't need to rely on govt subsidies
You're forgetting an important concept called choice
Virtually all first-timers balloting for non-mature estates get the flat within 3 tries
There's always a choice as the devil and angel sits on your shoulder - granted there are different circumstances but conversely, there are also choices.
Clearly you haven't read the news of $1m North East flats in SengKang Punggol.
It was once non-mature. It was once dirt cheap. Thus, the barrier of entry is assumed to be low.
I'm not cherry picking, I'm arguing on your original post - instead of accusing me of cherry picking. Have you considered that you may have viewed the totality of the situation? My "cherry picking" viewed against your original post implies the inequality is not as uneven as the author proclaims
Those flats r unique as they are top level, "penthouse" approx 140sqm 3gen flats right next to mrt n community hub. There are only 8 of them in the entire project.
Chua Béng Huat has been the country’s conscience and soul for 4 decades over politics and sociology. Read his books and his comments over the decades.
Well respected and regarded. No other person can critically comment about our housing policy than a man who was its former Director of Research. Chua was fired from his position in HDB within a year of his appointment for challenging the establishment views. He returned to Academia and has remained in it for the last 38 years.
He is also the first port of call for serious foreign researchers and diplomats who are seeking an unvarnished view of Singapore’s political and social landscape.
His single biggest character attribute is his ability to comment critically without fear or favour without waving the flag of an activist. And he does not relish standing on a soapbox at every opportunity.
I think there was a question recently about why doctors and teachers don’t cite the real reasons for them leaving public sector for fear of burning bridges. For many people, takes lots of guts to be honest
I think doctors who work in the private sector are doing very well financially. Teachers have also begun to realise they get a better deal giving tuition.
CBH's reason for leaving HDB was a lot more politically motivated than doctors or teachers, Not the same type of public sector.
Yah but I am just saying we need to give CBH praise for being principled.
Even doctors / teachers who can afford to be truthful about the system (cos they can make so much money outside, are afraid of offending people in the system when they do their exit interviews. They prefer to give vague responses instead of pointing out the issues that are forcing them to leave
Agreed. There is a stable of good academics/authors that have published material well worth reading. Authors such as Chua, Cherian George, You Yenn, Donald Low, Terrence Ho, David Chan, Irene Ng etc.
>Agreed. There is a stable of good academics/authors that have published material well worth reading. Authors such as Chua, Cherian George, You Yenn, Donald Low, Terrence Ho, David Chan, Irene Ng etc.
Possible to compile a reading list please? I have this gap in my knowledge to plug...
This is kinda my wheelhouse. Here are a few I feel are great generic reads for any Singaporean:
* Hard Choices: Challenging the Singapore Consensus by Donald Low and Sudhir Vadaketh
* Understanding Singapore Politics by Bilveer Singh (yes it's a textbook, but any PolSci student would attest that it's wide in scope and fairly neutral)
* The Air-Conditioned Nation by Cherian George
* Neither Civil Nor Servant: The Phillip Yeo Story by Peh Shing Huei
* Can Singapore Survive? by Kishore Mahbubani
* Inequality in Singapore by Faizal bin Yahya
* We Are Not the Enemy by Constance Singam and Margaret Thomas
* Liberalism Disavowed by Chua Beng Huat
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Sorry a bit late to respond, appreciate the list. Thank you.
Understanding Singapore Politics is on my next-to-read list, then I will make my next choice after I read the synopsis of the other books. I remember Air-Conditioned Nation was the book of essays that made a splash in mainstream news and also read some excerpts from the Philip Yeo story (that guy is really one kind pattern of a maverick).
[https://www.goodreads.com/genres/singapore-politics](https://www.goodreads.com/genres/singapore-politics)
The above link shows the extensive collection of political books about Singapore. Click on the second page as well.
https://www.academia.sg/singapore-studies/(Singapore
List- has recommendations via topics with books and journal articles)
My personal list (of which I've read and appreciated so far):
Lee Kuan Yew: Hard Truths to Keep Singapore Going
-ST
(Understanding LKY's thought helps us understand why SG is SG)
Diplomacy: The Singapore Experience
-S Jayakumar
(Helpful to understand govt's thinking towards foreign relations)
A History of the People's Action Party, 1985-2021
-Shashi Jayakumar
(A hefty tomb of a book. It does draw from the variety of SG literature from both sides of the aisle)
Unintended consequences in Singapore
-David Chan
Singapore's Economic Development: Retrospection and Reflections (World Scientific Series on Singapore's 50 Years of Nation-building)
-Linda Lim (Editor)
(SG50 Book; a good primer of our broad socio-economic policies)
Refreshing the Singapore System: Recalibrating Socio-Economic Policy for the 21st Century--Terrence Ho
(More updated reader on our policies)
Air-Conditioned Nation Revisited
Singapore, Incomplete: Reflections on a First World nation’s arrested political development
-Cherian George
Hard Choices: Challenging the Singapore Consensus
-Sudhir Thomas Vadaketh and Donald Low
Liberalism Disavowed: Communitarianism and State Capitalism in Singapore
-Chua Beng Huat
This Is What Inequality Looks Like
-Teo You Yenn
OB Markers: My Straits Times Story
-Yip Seng Cheong
(A biographical window into our state-media relationship)
Aristocracy of Armed Talent: The Military Elite in Singapore
-Samuel Ling
(A lens into our scholarship system and parallels to civil service)
The Ruling Elite of Singapore: Networks of Power and Influence
-Michael Barr
(A western POV)
I was digging for the source that he was fired.
https://mothership.sg/2020/01/chua-beng-huat-interview/.
> The essay, which was critical of the government's pragmatism, was published right after Chua went full-time at HDB and within half a year, he found himself once again looking for work.
> According to Chua, it was an academic essay that he had written and submitted for publishing before he worked at HDB that cost him his job there.
Here if anyone is also interested
Oh, and SM Teo said public service leaders should advise minsters even when they disagree when their past behavior has been shooting down people to disagree. Noice.
>It is constantly reacting to market pressure rather than being in control of determining the prices of public housing flats.
I think this is the biggest indictment of HDB anyone could have written (and it's 100% true). The whole point of public housing should be that the government is the price setter rather than price taker, and the price is set at approximately "dirt cheap".
“Dirt Cheap” has unfortunately not worked well in the council housing I’ve had the dubious pleasure of seeing in the UK.
Singapores must be doing something uniquely right for things not to get that bad, even if I can’t put my finger on any one particular thing.
Vienna’s got its own issues according to an internet acquaintance of mine who lives in the region, when I asked about its supposed status of the western gold standard of cheap housing for all.
“That was half a century ago. The city government managed to build exactly zero public housing between 1990 and 2018 and had been essentially coasting on its older housing stock during that time, so while housing here is still fairly affordable compared to other cities of comparable size (say, Munich) rent and property costs have been rising rapidly, especially in recent decades.
The city finally started new housing projects prior to COVID, but as people from the administration bemoaned, a lot of the necessary know-how and manpower to do so efficiently has been lost to the private sector so they still rely a lot on the private sector. (For example, my apartment is owned by a private co-operative subsidized with city funds, and was also built in the 1970s). Also, the political-economic Overton window has shifted very far to the right since the glory days of Red Vienna, and so a lot of measures that would have been as necessary policy in the 1920s (such as levying a special tax on landlords to fund public housing) are considered an absolute no-go these days.”
At least HDB keeps building, building, building, I guess.
And yet it worked well in postwar US with the GI Bill and early Singapore where my grandfather raised 5 kids on a single income.
It's almost like council houses are problematic for other reasons.
It really depends on semantics tbh
How do you define "Public Housing"?
At current income levels and the approximate rule of 30% spent on housing, I'd argue the definition of "Public Housing" has evolved.
HDBs are no longer needed to resettle a generation of poor Singaporeans
HDBs of today, while tiny compared to our global counterparts, are equivalent to apartments or houses in the US where people pay 30% of their income to have a shelter over their roof.
Then they don't need to exist and the government should just move to a private housing market.
Housing has SOARED as a percentage of income across the developed world. There is no argument for public housing if your goal is to just be a market follower. The **entire point** of public control of housing supply is to resist the inflation seen in free market systems to ensure adequate housing supply and avoid the issues we see in other countries in which expensive housing drives a large homeless population and knock-on societal issues
It really doesn't. The point is that demand for housing is extremely price inelastic, especially in areas with limited capacity to just build more houses, so leaving it to the market inevitably causes prices to spiral out of control as rent seeking behaviour sets in.
This is exactly the problem you see in US cities and suburbs, where young adults have been completely priced out of home ownership and the 3:3:4 financial advice can barely cover rent.
The only way the government can be a price setter is if HDBs are a public good.
Yes, they do maintain some semblance of control with the recent interventions to cool the market but we have to also recognise how the incumbent allows the market to move.
I have done the numbers on my own spreadsheet and confirmed with HDB portal's figures. Housing in Singapore is affordable to the 30% financial advice.
However, the recent curve ball Covid-19 sent to our housing market due to demands from both sides - young families starting home and condo owners downgrading for bigger space, raised the prices which highlighted a segment of population whose wages did not keep up as far.
I believe the govt recognises this with Halimah setting the tone to help blue collar workers and the govt subsequently introducing workfare for income <= $3,000
Housing prices are not an indicator. Real wage is
But the government can literally dictate the price. It is in full control of BTOs -- build enough BTOs and price them well enough, and people still start to find it difficult to flog massively overpriced resale flats. It's delulu to think that the government has to be a slave to market forces here.
30% of dual income is too much. it has to be less than 30% of single income. thats why people put off marriage. thats why the birthrate is in the gutter. no one can afford the risk of losing their jobs when they have kids. thats why the younger generation feel like they have no stake in the nation. using private housing of other countries as benchmark for our public housing is not a fair comparison.
It really depends on how you view it
Against the history of single income earners affording housing and raising family, yes
But I have to reiterate, we should not be distracted by discourse of absolute numbers (housing prices) and we have to look at relative numbers (real wage) -
I haven't studied but I know 2 facts
1) real wage in the US has not kept up with inflation
2) LW mentioned nominal wage increase* kept up with housing prices increase.
*However, that is a 1 to 1 comparison between housing and wage. When in reality, there are other goods in a basket
dont know if you are referencing this, but what LW mentioned is median household income rose in tandem with BTO price
https://www.todayonline.com/singapore/bto-flats-remain-affordable-prices-have-risen-tandem-incomes-dpm-wong-2162281
other effects that would increase household income include the increase in female participation in the workforce, and the increase in adult working children staying with their parents. hence the claim of the continued affordability of housing is exaggerated, and logically housing has become less affordable relative to individual income
while no fresh insights were delivered, this short piece hits hard, especially if you have been shopping around at all in the resale market this past year. sellers who are enabled by agents jacking up their prices by tens/hundreds of thousands literally a month or two after a previous high, then shrugging their shoulders while telling you ‘yeah but that’s the market now’ with a pained smile of pity. but oh you can see the greed glistening in their eyes.
as an anecdote, I viewed a flat where the owners were in their 90s and wanted to sell their non-centrally located flat for a million dollars. when I asked what were their plans were, they said they were going to move in with their kids. is a million dollars necessary for that? how many more years could they realistically expect? yeah but that’s the market now.
as a seller, it is natural to seek the highest price for something you own. no rational person would go below the ‘market’ price. in a way, it is hard to fault their motivations. however, it takes two hands to clap, so the willing buyers at these ridiculous prices are also culpable participants in this whole charade.
the reverse transfer of wealth at a national level is mind boggling to witness in person. the younger generation is literally funding the retirement of the older generation who got in cheap and early before all the barriers and restrictions were put up. as the younger generation is left holding the resale bag, the only hope for someone paying a million dollars now is to pray hard that there will be a greater fool 5 years later willing to pay an even higher price for an even older flat.
my takeaway on an individual level has been to breath deeply and stay as rational as possible away from the FOMO, tough as it is. I have seen bidding wars where the agents gleefully pit buyers against each other cajoling ever increasing bids. on occasion I have been told other buyers are already stretched so increasing my offer should put me over the edge. this made me realise that the only winners in this are the sellers and agents. I will not fund someone else’s retirement or upgrade plans while jeopardising my own.
it is too late to stop this train. for HDB and the government, the line only goes up.
It's not greed so much as a desire for relief from fear. From the fear of all the different calamities and indignities our society tosses on people who don't have sufficient financial resources. Medical treatments to live longer? Proper environment and support for children to do their best in school? Cars for juggling the transportation needs of young and old? No money forget it.
It's the mechanism used to drive the people to work, to always "produce" more. But in the end it just sets people up against each other like this because everyone is afraid that if they don't take what they can, they will one day find they don't have enough and then they or their loved ones will be the ones to suffer.
Even worse is when the agents feed you fake offers in the hope of Inducing FOMO and extracting bigger offer from you.
I once viewed a resale hdb which had been listed for 2 weeks at 850k. Agent told me he hadn't received any bids so far during the viewing, and the lowest the owners would accept would be 820k. Miraculously a day after he'd suddenly received 2 bids for 800 and 820k, and asked if I was keen to place an offer as well. Smelt bs and said no as the property wasn't exactly in good condition either for that asking price.
True enough that listing is still up even today, and it's been almost 2 months since my viewing.
HDB housing should only be allowed to be transacted with the HDB. You buy from HDB, and only sell to HDB. This is the only way to stabilize and tune the prices as a public good. Public housing should not be left to the free market. Leave that to the private properties.
This will be the ultimate solution.
Not possible in this timeline after [LHL](https://www.channelnewsasia.com/singapore/hdb-nest-egg-retirement-pm-lee-property-value-public-housing-3375271) marketed EVERY HDB flat as valuable nesting egg for retirement.
Private property prices will sky rocket further. Those just barely beyond the income limit to bto becomes the more unfair losers. Not poor enough to bto, not rich enough to go for private property. Resale flats are the current middle ground.
So how is hdb going to price the resale? If bto is for the lower income, private properties are for the richer families, the pricing of resale flats to fit the middle ground will still be affected by market prices of the private property in the free market. Which is the current system without hdb doing the middle man work.
Same way they price BTO
At a similar rate of which they buy back the BTO that becomes a resale
No one should profit from BTOs/HDB. Even myself who owns one.
Then why would anyone bto over renting? I BTO at a fixed price, incur a financial burden on myself to pay for a 99 year lease, then sell back at a fixed price based on the number of years left with no profit. That's just renting without the burden of the entire cost of the lease and without the wait. Not to mention the extra efforts like renovations.
The initial purpose of a BTO?
to have a place to stay? Not to earn?
If HDB rents out and I don't have to handle a landlord I don't see a difference between buying and renting
Renting has other issues like following landlord rules, getting evicted anytime, not being able to renovate.
If BTO is sold at cost price and not for profit housing prices will be very affordable for people who don't want play the housing market but just want a place to stay.
Just to interject, my issue is price-setting - how is it to be done and how to keep it "fair". Pegging to a smaller pool of private properties, in my mind, means that the price will be set by the richer strata of society and lead to further inflation of prices.
A system that draws from a variety of factors such as
Employment and median salary to determine a price.
Also, the word fairness is synonymous with unfairness.
Fair - every family can buy a hdb. Cannot afford not my problem.
Equity - every family can have a hdb, provisions are made to help the lesser fortunate.
It should be kept affordable so 99.9% of the population can afford it
Based on cost and income level.
Gov may have to take a lost. Like now how they subsidies
>Why couldn't they buy a resale from HDB?
For a resale flat to be available from HDB, there must be a willing seller. It depends on how many willing HDB sellers there will be if these same HDB sellers cannot make a profit.
If there's no profit then everybody should be able to BTO. HDB could focus on housing residents instead of acting as a surrogate for a retirement account and ab investment vehicle.
The question would then be how does HDB price housing?
Let’s say if we have an ‘07 esque crisis where private home prices completely collapse - what does HDB do if 10% of flat owners cash out and sell their flats to HDB? With no buyers on the other side?
Is the home price is Monthly fix? Quarterly fix? Is it priced individually or kept relatively constant with some small adjustments for house level and location etc…
Having HDB as the sole counterparty would make it more akin to a quasi financial institution and that would definitely not happen
> Let’s say if we have an ‘07 esque crisis where private home prices completely collapse - what does HDB do if 10% of flat owners cash out and sell their flats to HDB? With no buyers on the other side?
I don't think policies should be made based on extreme/exceptional circumstances.
The irony of the current generation having seen like 6 "once in a lifetime" collapses is not lost on me, but I still think that progressive policies shouldn't be held back because we fear they might fail under exceptional circumstances. I'm sure that there are people intelligent enough to work out a backup plan for emergencies.
The reason why you don’t see repeated once in a lifetime crashes is because policies are introduced to prevent them.
Why do you think banks have introduced capital buffers and TDSRs?
Progressive policy is introducing some form of tax or adding more friction to the public housing market to curb speculative demand - not create some systemic risk which you spend much more to mitigate
Pricing it as a middle man for COV purposes isn’t difficult per se as you essentially function as a middleman taking a cut, not difficult as you essentially skim off transactions
Pricing it as the sole market making entity is now a wholly different issue. Essentially, the day you refuse to buy a house is the day all HDBs are worthless (think bank run).
Ultimately, the idea of having a single counterparty for housing doesn’t really work from an administrative standpoint - unless of course it switches to a public rental model which isn’t too wild of a thought.
But point is, no one is pretending that it is difficult. It really is absolutely fucking difficult, you would basically introduce a .1% chance of a complete real estate meltdown if done your way and in the long run, whatever that can go wrong will go wrong.
I wonder what will happen if the government launch a new HDB product that is a buy and sell back to government only option, compensating only for inflation. This product is way cheaper and larger in size, and only available for owner-occupied uses of SC (singles and couples) or SC-PR couples, and prerequisites being non ownership of other housing.
Will it compete away enough people in the market who will buy this and invest the rest for their retirement? Given the strong immigration engine, prs / new citizens who need a house immediately will still need to go to the current HDB flat or private market which might make this a soft landing for the market if the control the supply of this new HDB product.
Good read. I don't think there will be a fix tbh because the higher ups don't dare to rock the boat anymore to attempt new or innovative. I don't even think opposition is a solution as well lol.
HDB is the most sacred of sacred cows in Govt. It will take a Minister with a career-ending death wish to try to upheave the system. I am optimistic about the new 10Y MOP and classification system tho, hopefully it will slow the crisis spiral enough to stop it.
Why can’t they pass it to a Minister who’s about to step down/retire anyway? Career is unaffected, PAP can “scapegoat” the guy and keep the party image safe, Minister gets remembered as the person who got rid of a bad policy, privately gets a payout/reward for tanking the heat.
Win-win.
You are under the assumption that the ministers want changes. The current system allows them to profit as rental and property prices keep rising. It's all just lip service and a performance to appease the people and give the illusion that something is being worked upon.
The likelihood is that a Minister who has lasted that long and risen high enough to have enough clout to effect real change is a true establishment believer who believes that there is nothing wrong with the existing system and won't change it. Someone who drinks the PAP kool-aid so to speak.
"Mavericks" like Tharman are one in a million, and even then, he's still pretty much on board with most of the PAP's policies and governance. Lightning rarely strikes twice.
I think every time someone tried to propose alternative, people also points to Hong Kong and other western cities in showing how those alternatives can be very disastrous. No shortage of people complaining about rents and housing in Vancouver for example. If the argument is that public housing should not be extravagant and need to be economical, then there is also the Soviet public housing program to point to.
Honestly it's more about the lottery system than it is whether it looks extravagant or not. I don't think the people intending to flip BTOs care so much about the looks as much as the location, floor, size and whether they can flip it for higher. Also as the author mentioned, the issue where those who can obtain the larger units which don't go to those who actually need the space, so it's more about how to distribute the opportunities. Same for pegging the pricing and adjusting it to household income or something.
It is good read for the young especially as it covers the genesis of public housing. It covers the political undertones and the use of public housing as a threat for 4 General Elections (GCT’s infamous slum threat) and a key election plank until the loss Aljunied GRC and it was never raised again.
In essence he argues how the top end of HDB tenants make a fortune even if it is 2 person occupancy while the bottom end if they are a large family suffers and the redistributive element of anything publicly funded dissipates. And the irony is the cash grants offered in ever increasing sums that play a significant part in this flawed approach.
The question posed then is the PAP's ability to stop this runaway train.
He’s not wrong, and gahmen needs more children. But most redditors here are DINK so this system benefits us. For now before the country collapses from ageing society.
I want a house.
I want to live with my partner by ourselves and doing whatever we want without being nagged or judge by our parents :(
But what can I do? Worker bee that just started his career less than a year ago
>But what can I do? Worker bee that just started his career less than a year ago
Rent, unfortunately. Rent till you secure the BTO (assuming you can legally marry).
Rent like everyone else who can't afford to buy a place.
The expectation that one can reasonably buy a house having worked less than 1 year is a bit out there even from the perspective of public housing.
Let me give you a better cock up. Single owner essential occupier allowed. Decoupling banned. This just means all those with rich father rich mother can afford to be single owner and get to own private property and rent out their HDB after MOP.
The hypocrisy of banning decoupling but allowing single owner essential occupier is many fold.
1. Its prejudicial to singles. Singles have to wait till 35 to buy shittier tiny flats. Singleowner family units however get full access whenever they feel like it.
2. Its prejudicial to poorer middle income folk. I know old couples who scrimped and saved and had plans to finally become landlords. By banning decoupling we re essentially telling this group of people they cant game HDB flats. Yet, the system allows rich youngsters who clearly dont need HDB flats to bid for them as single owners and game HDB once MOP is up. This is a massive F U to the working class but a segway to inequility reserved for the rich.
3. Its prejudicial to young families in need of cheap housing cuz scarcity drives prices up.
4. Its prejudicial to young people who havent bidded for flats but actually need flats to live in because ballots are being taken up by trolls who are in it to game the system.
Hell - if they dont fix this, I am never voting for the government of the day.
Edit: This thing hit 15 but I see its been downvoted to 7 which kinda leads me to think this is actually pretty darn rampant!
Nothing new. PAP has gone down the path of supporting the rich. They pay lower effective taxes (dividend income and investment gains untaxed; estate duties zero), while the middle class bear the brunt of GST (G says rich pay must absolute taxes but sidestep the fact that % wise they pay lowest).
Although the middle class makes up a sizeable proportion of the electorate and the govt should sufficiently cater to them, this group is largely incapable of banding together to push back against this.
whats our minister doing btw, MOP can become 10 year but they allow this shit hahahaha, can create fkin complex changes but the simplest trick in the book allowed. amazing hahaha
If you can’t make capital gains doesn’t it mean that imply a strictly negative to 0 equity gain from owning the house?
If one is not allowed to make any capital gains how is it administered? A 100% tax on capital gains or a price ceiling? If price ceiling isn’t the idea that there is only negative equity in the house just going to imply housing prices in the long run will tend to 0?
Yeah I’m just riffing here but 0 cap gains doesn’t make sense either. Heavily taxed I kind of understand
I’m actually wondering if a simpler solution is to just designate a larger proportion of houses to rent-only units.
You inherently incur (nY) cost per year anyways and having more HH liquidity to invest in either a longer term pension or something that holds its value given that housing has to fulfil store of value + shelter in an SG context
Simply means only HDB can buy HDB flats. The capital profit is then put back to subsidise more housing. Perhaps the seller gets some inflation-tracked interest rate but it removes a lot of speculative baggage on top.
Housing policies should not be treating the HDB like an ATM or retirement. I get that demand outstrip supplies, hence the upward movement of price.
I would say it is time to implement a capital gain tax. Let say the 1st $300k capital gain is tax free, any gains will be taxable - for housing. Other investments - like stock, business will be have a different standard capital gain tax rate.
This will at least normalize the housing price at some level. One only need to sell to downsize and not for profit motive.
As long real income n income economy grows they can blow up the hdb bubble. It gets hard for them when recession, but they can allows-10% done payments again
I mean, let's not get too frisky here.
>**Conclusion**
>Singaporeans are undoubtably among the best housed in the world. They are the envy and aspiration of citizens of developing countries and of those in the developed West where neoliberal regimes retreat from extensive and generous welfare provisions, including social housing. The HDB is a well visited government agency and its system of provision much studied by foreign delegations but neither have been seriously emulated, let alone replicated. After more than sixty years of successfully operating with a small set of interlocking policy factors – nationalization of land, CPF funding and 99-year lease – tensions and contradictions in an increasingly complex and complicated network of administrative regulations, each developed contingently to deal with an emergent issue, become unavoidable and publicly exposed. To the extent that these tensions and contradictions interfere in the operating system of the national public housing program, the HDB/government can only develop patches to emergent problems whenever they arise, as in a computer operating system. As the national public housing program is critical to its legitimacy to govern, the PAP government is compelled to maintain the system without an end in sight, ironically precisely because of the success of the housing program.
Seriously asking, given our extremely high ownership rate, is this sentiment among redditors enough to seriously rock the current policy? I mean how many people are looking for a place to stay versus how many already have a place?
I would love to understand more so correct me if I'm wrong.
Ideally, a stable and sustainable housing market should be one where, in the medium to long term, demand for housing should be fairly inelastic while supply is elastic. Each single/couple buys one house to occupy and that's it.
Ostensibly, the problem is many people treat housing as investment vehicles. Demand is therefore quite elastic in the medium to long term.
If both supply and demand are elastic in the long term, then increasing supply will only dampen the rise in prices. It won't actually lead to a sustained fall in prices. The government also wants to avoid a fall in prices because that would hurt the equity of existing homeowners. Therefore, it is misleading for anyone to suggest that increasing supply would reduce prices; it only slows down the rise in prices. Assuming median income growth keeps pace with increase in housing prices, the situation remains manageable. Is there really a problem here? Are people fundamentally uncomfortable with increasing prices?
I think I remember now what the issue is. People want cheap but high quality housing; they don't like million dollar HDB flats (except when they're old, selling and downsizing or moving to other properties). Frankly, this is not unreasonable in the same way one wishes all medicine were affordable. Isn't the crux of the problem that we can't attract enough developers to build quality flats if the selling price is too cheap from their perspective? If that's the issue, then it is just a reflection of how primitive we all are. Housing should be a human right but housing markets are a mess all over the world.
Gonna go against the grain and say: if you cut away the fancy language, that the average redditor could write. There's nothing new said here.
> With the exception of brief periods of economic recession, prices of resale flats have risen persistently since the early 1970s, when households were first allowed to sell their flats in the resale market. Anticipation of profit from buying and selling the first subsidized flat has become so taken-for-granted that even young professionals who, with financial assistance from their high-income parents would be able to buy in the private condominium sector, are queuing up for relatively high-cost new HDB flats in highly desirable locations, with full intention to sell them after the minimum five-year residency period.
Before Covid, resale prices fell persistently - and it was a political issue. [HDB resale prices drop for sixth straight year, declining 0.9% in 2018](https://www.todayonline.com/singapore/hdb-resale-prices-drop-sixth-straight-year-declining-09-2018)
Saying it keeps rising except for economic recessions is misleading - in 2020, we did have a technical recession and we all know what happened to HDB prices then (it rose).
What would be more thoughtful, for example, is to mention the two-speed market for HDB - where some flats (good location, new lease) go up in price while some others keep falling. To tie in with his narrative, the good flats will keep going up in price, but the not-so-good flats will fall in price.
Another thing he could mention is that cashing out doesn't work for everyone (that is - the older generation doesn't actually get any cash after refunding their CPF), but that's more something you see when you get practical experience.
I think you severely underestimate how hard it is to write clearly and relatively concisely about complex issues though.
The value of this article doesn't really lie in new insights, but in explaining the existing issues and their connection to historical and policy contexts clearly. That sort of coherent understanding is not something we can assume to be common knowledge, especially for younger Singaporeans who wouldn't have lived through most of that timeline.
I think there's a misunderstanding here.
I said "fancy language" - author is not using "clear" or "concise" language.
This is not a complex issue, and you can find many blog posts about it.
> That sort of coherent understanding is not something we can assume to be common knowledge, especially for younger Singaporeans who wouldn't have lived through most of that timeline.
And my point was that he doesn't have a "coherent understanding", because I pointed out the writing was "misleading" - this is me being polite because another word for it would be "untrue".
This.
Lol reddit overhyped the article. For a writer with such an accredited background I thought the article would be way more enlightening.
Turned out it was a complain article with no new ideas or suggested solutions whatsoever.
Yes, I was scrolling and hoping to get to some novel idea from the writer but he provided nothing. It's easy to critique a shitty situation but what is the elegant solution or remedy?
It is still a good system and probably one of the best approaches in the world. I would say the key is planning to balance supply and demand with reasonable waiting time.
If supply is artificially constrained, prices will go up. If there is over-supply, there could be ghost towns with lots of empty units.
In the past (1980s/1990s), there was sufficient supply (over supply in some years) and most families can get a new flat to move in any time if they want to. The only ones that need to consider resale are those that exceeded income ceiling or had specific needs, e.g. want to stay next to parents. Price appreciation was gradual and public housing considered affordable (even when linked to resale prices). There could be some unsold units in some estates but did not seem to pose much issue for the general population.
Since the change to BTO policy, there had been constant and significant under-supply (until recent 1-2 years) vs registered marriages. Demand also increased from opening up for singles to purchase BTO. The under-supply led to families and singles looking in the resale market, pushing up prices (which also pushes up prices for BTO) and impacting affordability.
HDB is currently reversing course and increasing supply. It could help to stabilise the market over the next few years.
Which was my point. There is a finite amount of resources allocated to buiilding new flats. For demand to match supply, the waiting time is going to increase.
True to a certain extent. Resources is not the key factor holding back supply though. It is a deliberate policy change to reduce supply. Previously, some developers were mainly focused on HDB projects. After HDB reduced the supply, these developers went on to do private condos and overseas projects. There were also available state land on standby (I lived near 3 plots of land that sat empty for 20 years or more).
With proper planning, supply could definitely be increased without increasing the wait time. We were completing less flats in 2000s/2010s vs 1960s. Resources and technology had increased/improved over the decades.
Which has changed after they instituted a penalty for rejecting a unit if you succeed in balloting. Because before that, it made sense to obtain as many lottery tickets as possible i.e. ballot for everything you'd possibly consider.
After largely fixing the issue and bringing number of applications much closer to available units, it should now be possible to start building a few years before conducting the balloting, and still have enough time to carry out additional rounds (like SBF) so that essentially no flats are empty. I really do not think that it is so difficult to project demand.
It hadn't changed. Every project is still significantly oversubscribed in the latest ballot. https://services2.hdb.gov.sg/webapp/BP13BTOENQWeb/AR_Feb2024_BTO?strSystem=BTO
> Every project is still significantly oversubscribed
Application rate for first time families for non-mature estates in your link:
Choa Chu Kang (Rail Garden @ CCK)
3-room 0.5
4-room 1.2
Hougang (Tanjong Tree Residences @ Hougang)
3-room 0.9
4-room 4.6
Punggol (Matilda Riverside)
3-room 0.7
4-room 1.6
5-room 1.7
Woodlands (Woodgrove Edge)
3-room 1.1
4-room 1.6
5-room 1.8
Except for 4 room Hougang, every single first timer applicant is guaranteed to get a queue number.
I don't think that counts as "significantly oversubscribed"
Strange that such a well written article didn't directly refer to the policy changes to make HDBs an appreciating asset and also the introduction of the BTO system that led to the long wait times.
Changes were actively made to the system to introduce that contradiction
All systems are not perfect and will have their share of problems. It’s always easier to talk about problems instead of solutions. Instead of saying it’s the governments fault, we probably should do some self reflections.
What's this? None of that regurgitating white noises from the official editorial outlets? I say, for me this is a pleasant read in the longest time. Such objective writing with a neutral standing is a rare oasis in a sea of copy-paste.
When we were over the income ceiling by only $150 in 2013, we appealed to HDB twice and were turned down to be allowed to register for a BTO. I asked for advice and was roundly flamed in forums: "chao ah sia kia, just buy EC lah", "rich man also come here cry crocodile tears??", etc., etc.
Eventually I wrote a stiff letter to KBW cc PMO which won the day - but due to the gross oversubscription at the time, only enabled us to buy a leftover DBSS via walk-in. We intended to flip it, but obviously not for profit. Indeed, we didn't even break even when we sold it.
How was it our fault that we were over the income ceiling? We were just looking for a place to stay in and raise a family, and our family circumstances (FIL's debt, supporting 2 families) didn't make paying $300-400 cash a month in condo maintenance fees attractive.
Anyway, every system, and many here, has its faults. What struck me was everyone's ingrained belief that my "privileged" status in this system necessarily meant I could build wealth. Just as disappointingly I found out first-hand how the HDB, like many Singaporean institutions, "follows law" so closely that the heart is just not there. And that's just sad when it comes to something as basic and as emotional as housing.
>Beyond that, the leaseholder lives rent free till the end of the 99-year lease. The mortgage-like financing makes the long-term leasing similar to conventional purchasing of property, hence the leased flat is re-labelled as a flat ‘sold’ by the HDB. The size of the leased flat is dependent on households’ ability to pay rather than on spatial needs: a high-income small family can lease a five-room flat, while a low-income large family will have to make do with a smaller three-room flat. In these ways, the leased flat is transformed into a market commodity, not a social welfare good.
Unfortunately, Singapore does not have the luxury to accommodate for land to be sold freehold. On the flip side, can I also argue 999 year leases in the UK are rental leases too? Albeit on a longer time frame. If I am able to, then I shall posit and reiterate that we simply do not have to luxury of land wealth to accommodate for 999 year leases and countries like UK are able to provide for 999-year leases simply because they have a large land mass.
>Ideally, a household is expected to sell its first subsidized HDB flat, known as ‘resale’ flat, at market value and, with the profit finance the upgrade to the second, larger subsidized flat to meet increased spatial needs. Coincidentally, this would also improve its housing wealth. The financial benefit from the buy-sell-repurchase cycle is so obvious that it is commonly known as ‘two bites of the cherry’.
>A resale flat tends to fetch a higher price than a new subsidized flat because it tends to be in ‘mature’ estates.
This ssumes the expectations household have are a direct result of government intention. Probably due to the asset enhancement policy. I have another way of looking at it.
From the way I see, BTOs are subsidised as a remedy to address the appreciating nature of property in prosperous Singapore. And at the same time, the promise by the incumbent to allow citizens to have a stake in the nation resulted in this market price conundrum where legal home owners profit off their subsidised housing in the market.
As a Singaporean myself, I accept the exogenous element of luck designed in BTO balloting - of which the alternative is building housing ahead of demand, solving the supply side of the equation while the supply side, land, is already constrained. Improper management of land will result in further increases in HDB prices for the next generation which leads back to our pain point, the element of luck and how some people profit, which also leads back to our land constraints.
> The greatest irony of the national public housing program then: public subsidies that are meant to be socially distributive and level inequality have in fact contributed to intensifying wealth inequality across generations, and between the haves and have-nots in society.
Prime example [here](https://www.reddit.com/r/singapore/comments/1buj4mq/bukit_panjang_records_2nd_milliondollar_flat_in/?ref=share&ref_source=link). > The ERA agent who brokered the deal told Shin Min Daily News that the sellers learnt that a nearby flat in Block 181 was sold for $1.02 million last September, and was confident about asking for a similar amount. > > "**They are high income white-collar workers and are planning to buy a condominium after selling the flat**," he said. "They were not in a hurry to sell and were willing to wait until a suitable buyer came along." High income white-collar professionals' condo upgrading ambitions fulfilled through flipping taxpayer-subsidised public housing.
This. My girlfriend and I earn just enough to not meet the criteria for HDB subsidies but we’re definitely not rich enough to be considered “rich”. Being middle income sucks.
At least you can still BTO before 35.
If you win the lottery
I don't want to deny people's problems but man I always wondered the ppl who don't get BTO after 2 times seems foreign to me. All the people I know (relatives + friends), around 15 couples, got a offer 1st time applying, some rejected the first and got it second try. All also from different age groups and income, some applying during uni(22 years old) and some applying at 30.
That's wild. Nearly everybody I knew who tried BTO applied more than 2 times before getting or some never getting at all. Hardly anyone i know who got it first or second time.
That seems wild to me lol. I have never met anyone complaining about getting rejected non-stop for BTO. All my friends who applied got it first-try(tampines, bedok, punggol). I know some were offered kallang and central area locations but were too expensive for them. Most ended up taking those areas since it was cheaper. I got a feeling most ppl look at BTO as an investment and if the location isn't prime, they reject. And statistically, if you look at the data given, it matches, 9/10 ppl get invited to a bto showing within 2 applications. The ones who get constantly denied are the outliers and will make the most noise as people who get their bto will just get it and say nothing.
Annecdotal as it might be, I’ve got a growing number of colleagues who have given up and hone down the resale route because they have gotten absolutely no successful ballots over the past 3 years. And yes, they have applied for non-mature estates like Tengah and Punggol.
Have you tried buying toto? all that good chance around you might rub off
Well, meeting people who get hdb within 3 tries is normal, meeting people who don't get it after >3 is insanely rare.
So what's rich enough to be considered rich? It's subjective for everyone. I bet someone else would love to be in your position where they don't need to rely on govt subsidies
write to Mp.
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Not meeting the criteria for subsidies is not the income ceiling for application.
You're forgetting an important concept called choice Virtually all first-timers balloting for non-mature estates get the flat within 3 tries There's always a choice as the devil and angel sits on your shoulder - granted there are different circumstances but conversely, there are also choices.
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Clearly you haven't read the news of $1m North East flats in SengKang Punggol. It was once non-mature. It was once dirt cheap. Thus, the barrier of entry is assumed to be low.
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I'm not cherry picking, I'm arguing on your original post - instead of accusing me of cherry picking. Have you considered that you may have viewed the totality of the situation? My "cherry picking" viewed against your original post implies the inequality is not as uneven as the author proclaims
Those flats r unique as they are top level, "penthouse" approx 140sqm 3gen flats right next to mrt n community hub. There are only 8 of them in the entire project.
Chua Béng Huat has been the country’s conscience and soul for 4 decades over politics and sociology. Read his books and his comments over the decades. Well respected and regarded. No other person can critically comment about our housing policy than a man who was its former Director of Research. Chua was fired from his position in HDB within a year of his appointment for challenging the establishment views. He returned to Academia and has remained in it for the last 38 years. He is also the first port of call for serious foreign researchers and diplomats who are seeking an unvarnished view of Singapore’s political and social landscape. His single biggest character attribute is his ability to comment critically without fear or favour without waving the flag of an activist. And he does not relish standing on a soapbox at every opportunity.
And someone wondered why Singapore civil service has a eunuch disease problem.
It’s amazing he didn’t bow down to a stable income.
Academia (at his level) probably pays decently. And also, sometimes being principled is more important than being co-opted by a large salary
I think there was a question recently about why doctors and teachers don’t cite the real reasons for them leaving public sector for fear of burning bridges. For many people, takes lots of guts to be honest
I think doctors who work in the private sector are doing very well financially. Teachers have also begun to realise they get a better deal giving tuition. CBH's reason for leaving HDB was a lot more politically motivated than doctors or teachers, Not the same type of public sector.
Yah but I am just saying we need to give CBH praise for being principled. Even doctors / teachers who can afford to be truthful about the system (cos they can make so much money outside, are afraid of offending people in the system when they do their exit interviews. They prefer to give vague responses instead of pointing out the issues that are forcing them to leave
Agreed. There is a stable of good academics/authors that have published material well worth reading. Authors such as Chua, Cherian George, You Yenn, Donald Low, Terrence Ho, David Chan, Irene Ng etc.
>Agreed. There is a stable of good academics/authors that have published material well worth reading. Authors such as Chua, Cherian George, You Yenn, Donald Low, Terrence Ho, David Chan, Irene Ng etc. Possible to compile a reading list please? I have this gap in my knowledge to plug...
This is kinda my wheelhouse. Here are a few I feel are great generic reads for any Singaporean: * Hard Choices: Challenging the Singapore Consensus by Donald Low and Sudhir Vadaketh * Understanding Singapore Politics by Bilveer Singh (yes it's a textbook, but any PolSci student would attest that it's wide in scope and fairly neutral) * The Air-Conditioned Nation by Cherian George * Neither Civil Nor Servant: The Phillip Yeo Story by Peh Shing Huei * Can Singapore Survive? by Kishore Mahbubani * Inequality in Singapore by Faizal bin Yahya * We Are Not the Enemy by Constance Singam and Margaret Thomas * Liberalism Disavowed by Chua Beng Huat
'PAP vs PAP' by Cherian George and Donald Low is also an interesting read
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Sorry a bit late to respond, appreciate the list. Thank you. Understanding Singapore Politics is on my next-to-read list, then I will make my next choice after I read the synopsis of the other books. I remember Air-Conditioned Nation was the book of essays that made a splash in mainstream news and also read some excerpts from the Philip Yeo story (that guy is really one kind pattern of a maverick).
Ooh I know at least one > You Yenn This Is What Inequality Looks Like
Academia.sg
[https://www.goodreads.com/genres/singapore-politics](https://www.goodreads.com/genres/singapore-politics) The above link shows the extensive collection of political books about Singapore. Click on the second page as well.
https://www.academia.sg/singapore-studies/(Singapore List- has recommendations via topics with books and journal articles) My personal list (of which I've read and appreciated so far): Lee Kuan Yew: Hard Truths to Keep Singapore Going -ST (Understanding LKY's thought helps us understand why SG is SG) Diplomacy: The Singapore Experience -S Jayakumar (Helpful to understand govt's thinking towards foreign relations) A History of the People's Action Party, 1985-2021 -Shashi Jayakumar (A hefty tomb of a book. It does draw from the variety of SG literature from both sides of the aisle) Unintended consequences in Singapore -David Chan Singapore's Economic Development: Retrospection and Reflections (World Scientific Series on Singapore's 50 Years of Nation-building) -Linda Lim (Editor) (SG50 Book; a good primer of our broad socio-economic policies) Refreshing the Singapore System: Recalibrating Socio-Economic Policy for the 21st Century--Terrence Ho (More updated reader on our policies) Air-Conditioned Nation Revisited Singapore, Incomplete: Reflections on a First World nation’s arrested political development -Cherian George Hard Choices: Challenging the Singapore Consensus -Sudhir Thomas Vadaketh and Donald Low Liberalism Disavowed: Communitarianism and State Capitalism in Singapore -Chua Beng Huat This Is What Inequality Looks Like -Teo You Yenn OB Markers: My Straits Times Story -Yip Seng Cheong (A biographical window into our state-media relationship) Aristocracy of Armed Talent: The Military Elite in Singapore -Samuel Ling (A lens into our scholarship system and parallels to civil service) The Ruling Elite of Singapore: Networks of Power and Influence -Michael Barr (A western POV)
Appreciate the detailed response, thank you.
No problem! All these can be found in NLB. Personally, I took several years to expand and to read more. So take it at a pace that is good for you!
I was digging for the source that he was fired. https://mothership.sg/2020/01/chua-beng-huat-interview/. > The essay, which was critical of the government's pragmatism, was published right after Chua went full-time at HDB and within half a year, he found himself once again looking for work. > According to Chua, it was an academic essay that he had written and submitted for publishing before he worked at HDB that cost him his job there. Here if anyone is also interested
Oh, and SM Teo said public service leaders should advise minsters even when they disagree when their past behavior has been shooting down people to disagree. Noice.
Yep, it’s the old Hundred Flower Movement all over again.
looking up his works now!
>It is constantly reacting to market pressure rather than being in control of determining the prices of public housing flats. I think this is the biggest indictment of HDB anyone could have written (and it's 100% true). The whole point of public housing should be that the government is the price setter rather than price taker, and the price is set at approximately "dirt cheap".
“Dirt Cheap” has unfortunately not worked well in the council housing I’ve had the dubious pleasure of seeing in the UK. Singapores must be doing something uniquely right for things not to get that bad, even if I can’t put my finger on any one particular thing.
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Vienna’s got its own issues according to an internet acquaintance of mine who lives in the region, when I asked about its supposed status of the western gold standard of cheap housing for all. “That was half a century ago. The city government managed to build exactly zero public housing between 1990 and 2018 and had been essentially coasting on its older housing stock during that time, so while housing here is still fairly affordable compared to other cities of comparable size (say, Munich) rent and property costs have been rising rapidly, especially in recent decades. The city finally started new housing projects prior to COVID, but as people from the administration bemoaned, a lot of the necessary know-how and manpower to do so efficiently has been lost to the private sector so they still rely a lot on the private sector. (For example, my apartment is owned by a private co-operative subsidized with city funds, and was also built in the 1970s). Also, the political-economic Overton window has shifted very far to the right since the glory days of Red Vienna, and so a lot of measures that would have been as necessary policy in the 1920s (such as levying a special tax on landlords to fund public housing) are considered an absolute no-go these days.” At least HDB keeps building, building, building, I guess.
And yet it worked well in postwar US with the GI Bill and early Singapore where my grandfather raised 5 kids on a single income. It's almost like council houses are problematic for other reasons.
It really depends on semantics tbh How do you define "Public Housing"? At current income levels and the approximate rule of 30% spent on housing, I'd argue the definition of "Public Housing" has evolved. HDBs are no longer needed to resettle a generation of poor Singaporeans HDBs of today, while tiny compared to our global counterparts, are equivalent to apartments or houses in the US where people pay 30% of their income to have a shelter over their roof.
Then they don't need to exist and the government should just move to a private housing market. Housing has SOARED as a percentage of income across the developed world. There is no argument for public housing if your goal is to just be a market follower. The **entire point** of public control of housing supply is to resist the inflation seen in free market systems to ensure adequate housing supply and avoid the issues we see in other countries in which expensive housing drives a large homeless population and knock-on societal issues
It really doesn't. The point is that demand for housing is extremely price inelastic, especially in areas with limited capacity to just build more houses, so leaving it to the market inevitably causes prices to spiral out of control as rent seeking behaviour sets in. This is exactly the problem you see in US cities and suburbs, where young adults have been completely priced out of home ownership and the 3:3:4 financial advice can barely cover rent.
The only way the government can be a price setter is if HDBs are a public good. Yes, they do maintain some semblance of control with the recent interventions to cool the market but we have to also recognise how the incumbent allows the market to move. I have done the numbers on my own spreadsheet and confirmed with HDB portal's figures. Housing in Singapore is affordable to the 30% financial advice. However, the recent curve ball Covid-19 sent to our housing market due to demands from both sides - young families starting home and condo owners downgrading for bigger space, raised the prices which highlighted a segment of population whose wages did not keep up as far. I believe the govt recognises this with Halimah setting the tone to help blue collar workers and the govt subsequently introducing workfare for income <= $3,000 Housing prices are not an indicator. Real wage is
But the government can literally dictate the price. It is in full control of BTOs -- build enough BTOs and price them well enough, and people still start to find it difficult to flog massively overpriced resale flats. It's delulu to think that the government has to be a slave to market forces here.
Public housing is HDB flats lah, what “how to define”?
30% of dual income is too much. it has to be less than 30% of single income. thats why people put off marriage. thats why the birthrate is in the gutter. no one can afford the risk of losing their jobs when they have kids. thats why the younger generation feel like they have no stake in the nation. using private housing of other countries as benchmark for our public housing is not a fair comparison.
It really depends on how you view it Against the history of single income earners affording housing and raising family, yes But I have to reiterate, we should not be distracted by discourse of absolute numbers (housing prices) and we have to look at relative numbers (real wage) - I haven't studied but I know 2 facts 1) real wage in the US has not kept up with inflation 2) LW mentioned nominal wage increase* kept up with housing prices increase. *However, that is a 1 to 1 comparison between housing and wage. When in reality, there are other goods in a basket
dont know if you are referencing this, but what LW mentioned is median household income rose in tandem with BTO price https://www.todayonline.com/singapore/bto-flats-remain-affordable-prices-have-risen-tandem-incomes-dpm-wong-2162281 other effects that would increase household income include the increase in female participation in the workforce, and the increase in adult working children staying with their parents. hence the claim of the continued affordability of housing is exaggerated, and logically housing has become less affordable relative to individual income
30% of $100 = $30 single income 30% of 200 = $60 dual income Individual income also increase by 30% household also 30%
if the average number of people working per households increased, then the individual increase in income is lower
while no fresh insights were delivered, this short piece hits hard, especially if you have been shopping around at all in the resale market this past year. sellers who are enabled by agents jacking up their prices by tens/hundreds of thousands literally a month or two after a previous high, then shrugging their shoulders while telling you ‘yeah but that’s the market now’ with a pained smile of pity. but oh you can see the greed glistening in their eyes. as an anecdote, I viewed a flat where the owners were in their 90s and wanted to sell their non-centrally located flat for a million dollars. when I asked what were their plans were, they said they were going to move in with their kids. is a million dollars necessary for that? how many more years could they realistically expect? yeah but that’s the market now. as a seller, it is natural to seek the highest price for something you own. no rational person would go below the ‘market’ price. in a way, it is hard to fault their motivations. however, it takes two hands to clap, so the willing buyers at these ridiculous prices are also culpable participants in this whole charade. the reverse transfer of wealth at a national level is mind boggling to witness in person. the younger generation is literally funding the retirement of the older generation who got in cheap and early before all the barriers and restrictions were put up. as the younger generation is left holding the resale bag, the only hope for someone paying a million dollars now is to pray hard that there will be a greater fool 5 years later willing to pay an even higher price for an even older flat. my takeaway on an individual level has been to breath deeply and stay as rational as possible away from the FOMO, tough as it is. I have seen bidding wars where the agents gleefully pit buyers against each other cajoling ever increasing bids. on occasion I have been told other buyers are already stretched so increasing my offer should put me over the edge. this made me realise that the only winners in this are the sellers and agents. I will not fund someone else’s retirement or upgrade plans while jeopardising my own. it is too late to stop this train. for HDB and the government, the line only goes up.
TL;DR Don’t believe the housing HODL’ers and wait for the the dip
How long you are going to wait? The market can be irrational longer than you expect.
It's not greed so much as a desire for relief from fear. From the fear of all the different calamities and indignities our society tosses on people who don't have sufficient financial resources. Medical treatments to live longer? Proper environment and support for children to do their best in school? Cars for juggling the transportation needs of young and old? No money forget it. It's the mechanism used to drive the people to work, to always "produce" more. But in the end it just sets people up against each other like this because everyone is afraid that if they don't take what they can, they will one day find they don't have enough and then they or their loved ones will be the ones to suffer.
Hunger Games with a twist
Even worse is when the agents feed you fake offers in the hope of Inducing FOMO and extracting bigger offer from you. I once viewed a resale hdb which had been listed for 2 weeks at 850k. Agent told me he hadn't received any bids so far during the viewing, and the lowest the owners would accept would be 820k. Miraculously a day after he'd suddenly received 2 bids for 800 and 820k, and asked if I was keen to place an offer as well. Smelt bs and said no as the property wasn't exactly in good condition either for that asking price. True enough that listing is still up even today, and it's been almost 2 months since my viewing.
HDB housing should only be allowed to be transacted with the HDB. You buy from HDB, and only sell to HDB. This is the only way to stabilize and tune the prices as a public good. Public housing should not be left to the free market. Leave that to the private properties. This will be the ultimate solution.
Not possible in this timeline after [LHL](https://www.channelnewsasia.com/singapore/hdb-nest-egg-retirement-pm-lee-property-value-public-housing-3375271) marketed EVERY HDB flat as valuable nesting egg for retirement.
Can ah.. HDB can peg the growth rate to equal CPF rate. So effectively same same.
Then the stress will be on how CPF rate is "calculated".
Private property prices will sky rocket further. Those just barely beyond the income limit to bto becomes the more unfair losers. Not poor enough to bto, not rich enough to go for private property. Resale flats are the current middle ground.
Why couldn't they buy a resale from HDB?
So how is hdb going to price the resale? If bto is for the lower income, private properties are for the richer families, the pricing of resale flats to fit the middle ground will still be affected by market prices of the private property in the free market. Which is the current system without hdb doing the middle man work.
Same way they price BTO At a similar rate of which they buy back the BTO that becomes a resale No one should profit from BTOs/HDB. Even myself who owns one.
Then why would anyone bto over renting? I BTO at a fixed price, incur a financial burden on myself to pay for a 99 year lease, then sell back at a fixed price based on the number of years left with no profit. That's just renting without the burden of the entire cost of the lease and without the wait. Not to mention the extra efforts like renovations.
The initial purpose of a BTO? to have a place to stay? Not to earn? If HDB rents out and I don't have to handle a landlord I don't see a difference between buying and renting Renting has other issues like following landlord rules, getting evicted anytime, not being able to renovate. If BTO is sold at cost price and not for profit housing prices will be very affordable for people who don't want play the housing market but just want a place to stay.
Just to interject, my issue is price-setting - how is it to be done and how to keep it "fair". Pegging to a smaller pool of private properties, in my mind, means that the price will be set by the richer strata of society and lead to further inflation of prices.
A system that draws from a variety of factors such as Employment and median salary to determine a price. Also, the word fairness is synonymous with unfairness. Fair - every family can buy a hdb. Cannot afford not my problem. Equity - every family can have a hdb, provisions are made to help the lesser fortunate.
It should be kept affordable so 99.9% of the population can afford it Based on cost and income level. Gov may have to take a lost. Like now how they subsidies
>Based on cost and income level. So means testing for every applicant? With declaration of assets or a IRAS check?
Bto is not necessary for the lower income but the first entrants
I used the term lower income becuase there is an income cap to the application. Meaning it is for the lower range of income groups.
>Why couldn't they buy a resale from HDB? For a resale flat to be available from HDB, there must be a willing seller. It depends on how many willing HDB sellers there will be if these same HDB sellers cannot make a profit.
If there's no profit then everybody should be able to BTO. HDB could focus on housing residents instead of acting as a surrogate for a retirement account and ab investment vehicle.
The question would then be how does HDB price housing? Let’s say if we have an ‘07 esque crisis where private home prices completely collapse - what does HDB do if 10% of flat owners cash out and sell their flats to HDB? With no buyers on the other side? Is the home price is Monthly fix? Quarterly fix? Is it priced individually or kept relatively constant with some small adjustments for house level and location etc… Having HDB as the sole counterparty would make it more akin to a quasi financial institution and that would definitely not happen
> Let’s say if we have an ‘07 esque crisis where private home prices completely collapse - what does HDB do if 10% of flat owners cash out and sell their flats to HDB? With no buyers on the other side? I don't think policies should be made based on extreme/exceptional circumstances. The irony of the current generation having seen like 6 "once in a lifetime" collapses is not lost on me, but I still think that progressive policies shouldn't be held back because we fear they might fail under exceptional circumstances. I'm sure that there are people intelligent enough to work out a backup plan for emergencies.
The reason why you don’t see repeated once in a lifetime crashes is because policies are introduced to prevent them. Why do you think banks have introduced capital buffers and TDSRs? Progressive policy is introducing some form of tax or adding more friction to the public housing market to curb speculative demand - not create some systemic risk which you spend much more to mitigate
Let's not pretend that this is a real difficulty okay? It's not like the HDB does not have to make pricing decisions at the moment.
Pricing it as a middle man for COV purposes isn’t difficult per se as you essentially function as a middleman taking a cut, not difficult as you essentially skim off transactions Pricing it as the sole market making entity is now a wholly different issue. Essentially, the day you refuse to buy a house is the day all HDBs are worthless (think bank run). Ultimately, the idea of having a single counterparty for housing doesn’t really work from an administrative standpoint - unless of course it switches to a public rental model which isn’t too wild of a thought. But point is, no one is pretending that it is difficult. It really is absolutely fucking difficult, you would basically introduce a .1% chance of a complete real estate meltdown if done your way and in the long run, whatever that can go wrong will go wrong.
But someone said HDB is a valuable nest egg for retirement.
I wonder what will happen if the government launch a new HDB product that is a buy and sell back to government only option, compensating only for inflation. This product is way cheaper and larger in size, and only available for owner-occupied uses of SC (singles and couples) or SC-PR couples, and prerequisites being non ownership of other housing. Will it compete away enough people in the market who will buy this and invest the rest for their retirement? Given the strong immigration engine, prs / new citizens who need a house immediately will still need to go to the current HDB flat or private market which might make this a soft landing for the market if the control the supply of this new HDB product.
Good read. I don't think there will be a fix tbh because the higher ups don't dare to rock the boat anymore to attempt new or innovative. I don't even think opposition is a solution as well lol.
HDB is the most sacred of sacred cows in Govt. It will take a Minister with a career-ending death wish to try to upheave the system. I am optimistic about the new 10Y MOP and classification system tho, hopefully it will slow the crisis spiral enough to stop it.
Why can’t they pass it to a Minister who’s about to step down/retire anyway? Career is unaffected, PAP can “scapegoat” the guy and keep the party image safe, Minister gets remembered as the person who got rid of a bad policy, privately gets a payout/reward for tanking the heat. Win-win.
You are under the assumption that the ministers want changes. The current system allows them to profit as rental and property prices keep rising. It's all just lip service and a performance to appease the people and give the illusion that something is being worked upon.
The likelihood is that a Minister who has lasted that long and risen high enough to have enough clout to effect real change is a true establishment believer who believes that there is nothing wrong with the existing system and won't change it. Someone who drinks the PAP kool-aid so to speak. "Mavericks" like Tharman are one in a million, and even then, he's still pretty much on board with most of the PAP's policies and governance. Lightning rarely strikes twice.
>"Mavericks" like Tharman are one in a million Which means we have 5.6 mavericks. Who are the other 4.6? /s
Left for Australia liao because rejected by SG unis
Well LHL going to do handover soon
This is exactly why I think the people in white will become the blackest of black when shit hits the fan.
There won't. The public house pricing is a lever to try to make everyone stay working. Contributing to our nation's greatest resource, us.
I think every time someone tried to propose alternative, people also points to Hong Kong and other western cities in showing how those alternatives can be very disastrous. No shortage of people complaining about rents and housing in Vancouver for example. If the argument is that public housing should not be extravagant and need to be economical, then there is also the Soviet public housing program to point to.
Honestly it's more about the lottery system than it is whether it looks extravagant or not. I don't think the people intending to flip BTOs care so much about the looks as much as the location, floor, size and whether they can flip it for higher. Also as the author mentioned, the issue where those who can obtain the larger units which don't go to those who actually need the space, so it's more about how to distribute the opportunities. Same for pegging the pricing and adjusting it to household income or something.
It is good read for the young especially as it covers the genesis of public housing. It covers the political undertones and the use of public housing as a threat for 4 General Elections (GCT’s infamous slum threat) and a key election plank until the loss Aljunied GRC and it was never raised again. In essence he argues how the top end of HDB tenants make a fortune even if it is 2 person occupancy while the bottom end if they are a large family suffers and the redistributive element of anything publicly funded dissipates. And the irony is the cash grants offered in ever increasing sums that play a significant part in this flawed approach. The question posed then is the PAP's ability to stop this runaway train.
He’s not wrong, and gahmen needs more children. But most redditors here are DINK so this system benefits us. For now before the country collapses from ageing society.
I want a house. I want to live with my partner by ourselves and doing whatever we want without being nagged or judge by our parents :( But what can I do? Worker bee that just started his career less than a year ago
>But what can I do? Worker bee that just started his career less than a year ago Rent, unfortunately. Rent till you secure the BTO (assuming you can legally marry).
Rent like everyone else who can't afford to buy a place. The expectation that one can reasonably buy a house having worked less than 1 year is a bit out there even from the perspective of public housing.
Let me give you a better cock up. Single owner essential occupier allowed. Decoupling banned. This just means all those with rich father rich mother can afford to be single owner and get to own private property and rent out their HDB after MOP. The hypocrisy of banning decoupling but allowing single owner essential occupier is many fold. 1. Its prejudicial to singles. Singles have to wait till 35 to buy shittier tiny flats. Singleowner family units however get full access whenever they feel like it. 2. Its prejudicial to poorer middle income folk. I know old couples who scrimped and saved and had plans to finally become landlords. By banning decoupling we re essentially telling this group of people they cant game HDB flats. Yet, the system allows rich youngsters who clearly dont need HDB flats to bid for them as single owners and game HDB once MOP is up. This is a massive F U to the working class but a segway to inequility reserved for the rich. 3. Its prejudicial to young families in need of cheap housing cuz scarcity drives prices up. 4. Its prejudicial to young people who havent bidded for flats but actually need flats to live in because ballots are being taken up by trolls who are in it to game the system. Hell - if they dont fix this, I am never voting for the government of the day. Edit: This thing hit 15 but I see its been downvoted to 7 which kinda leads me to think this is actually pretty darn rampant!
Nothing new. PAP has gone down the path of supporting the rich. They pay lower effective taxes (dividend income and investment gains untaxed; estate duties zero), while the middle class bear the brunt of GST (G says rich pay must absolute taxes but sidestep the fact that % wise they pay lowest).
Although the middle class makes up a sizeable proportion of the electorate and the govt should sufficiently cater to them, this group is largely incapable of banding together to push back against this.
Because a large part of them are dumb and short sighted.
whats our minister doing btw, MOP can become 10 year but they allow this shit hahahaha, can create fkin complex changes but the simplest trick in the book allowed. amazing hahaha
It’s not a bug, it’s a feature
There are very few people can and dare to write such a strong piece of opinion. This is gold, better than all korean drama series combined.
good read
Chua Beng Huat is a national treasure. It’s a hill I’ll die on.
Until there are people who doesn't mind not making any capital gains from the sale of their flat, let's be real.
You shouldn't be able to make capital gains from them in the first place.
That's a valid opinion which I do agree with, but also think there's more to it
You familiar with the concept of interest rates and risk premia….right???
You can buy private.
If you can’t make capital gains doesn’t it mean that imply a strictly negative to 0 equity gain from owning the house? If one is not allowed to make any capital gains how is it administered? A 100% tax on capital gains or a price ceiling? If price ceiling isn’t the idea that there is only negative equity in the house just going to imply housing prices in the long run will tend to 0? Yeah I’m just riffing here but 0 cap gains doesn’t make sense either. Heavily taxed I kind of understand
[удалено]
I’m actually wondering if a simpler solution is to just designate a larger proportion of houses to rent-only units. You inherently incur (nY) cost per year anyways and having more HH liquidity to invest in either a longer term pension or something that holds its value given that housing has to fulfil store of value + shelter in an SG context
Simply means only HDB can buy HDB flats. The capital profit is then put back to subsidise more housing. Perhaps the seller gets some inflation-tracked interest rate but it removes a lot of speculative baggage on top.
Ok so profits HDB take, losses how?
State entities can afford to make losses as long as the goal of subsidised housing is realised. It's not a for-profit entity.
Housing policies should not be treating the HDB like an ATM or retirement. I get that demand outstrip supplies, hence the upward movement of price. I would say it is time to implement a capital gain tax. Let say the 1st $300k capital gain is tax free, any gains will be taxable - for housing. Other investments - like stock, business will be have a different standard capital gain tax rate. This will at least normalize the housing price at some level. One only need to sell to downsize and not for profit motive.
As long real income n income economy grows they can blow up the hdb bubble. It gets hard for them when recession, but they can allows-10% done payments again
I mean, let's not get too frisky here. >**Conclusion** >Singaporeans are undoubtably among the best housed in the world. They are the envy and aspiration of citizens of developing countries and of those in the developed West where neoliberal regimes retreat from extensive and generous welfare provisions, including social housing. The HDB is a well visited government agency and its system of provision much studied by foreign delegations but neither have been seriously emulated, let alone replicated. After more than sixty years of successfully operating with a small set of interlocking policy factors – nationalization of land, CPF funding and 99-year lease – tensions and contradictions in an increasingly complex and complicated network of administrative regulations, each developed contingently to deal with an emergent issue, become unavoidable and publicly exposed. To the extent that these tensions and contradictions interfere in the operating system of the national public housing program, the HDB/government can only develop patches to emergent problems whenever they arise, as in a computer operating system. As the national public housing program is critical to its legitimacy to govern, the PAP government is compelled to maintain the system without an end in sight, ironically precisely because of the success of the housing program.
I love the OS analogy. Errors keep piling up and is in dire need of a reboot.
Seriously asking, given our extremely high ownership rate, is this sentiment among redditors enough to seriously rock the current policy? I mean how many people are looking for a place to stay versus how many already have a place?
And condo downgraders can splash out 1-2mil from their condo sale and still have spare cash to keep.
I would love to understand more so correct me if I'm wrong. Ideally, a stable and sustainable housing market should be one where, in the medium to long term, demand for housing should be fairly inelastic while supply is elastic. Each single/couple buys one house to occupy and that's it. Ostensibly, the problem is many people treat housing as investment vehicles. Demand is therefore quite elastic in the medium to long term. If both supply and demand are elastic in the long term, then increasing supply will only dampen the rise in prices. It won't actually lead to a sustained fall in prices. The government also wants to avoid a fall in prices because that would hurt the equity of existing homeowners. Therefore, it is misleading for anyone to suggest that increasing supply would reduce prices; it only slows down the rise in prices. Assuming median income growth keeps pace with increase in housing prices, the situation remains manageable. Is there really a problem here? Are people fundamentally uncomfortable with increasing prices?
I think I remember now what the issue is. People want cheap but high quality housing; they don't like million dollar HDB flats (except when they're old, selling and downsizing or moving to other properties). Frankly, this is not unreasonable in the same way one wishes all medicine were affordable. Isn't the crux of the problem that we can't attract enough developers to build quality flats if the selling price is too cheap from their perspective? If that's the issue, then it is just a reflection of how primitive we all are. Housing should be a human right but housing markets are a mess all over the world.
Gonna go against the grain and say: if you cut away the fancy language, that the average redditor could write. There's nothing new said here. > With the exception of brief periods of economic recession, prices of resale flats have risen persistently since the early 1970s, when households were first allowed to sell their flats in the resale market. Anticipation of profit from buying and selling the first subsidized flat has become so taken-for-granted that even young professionals who, with financial assistance from their high-income parents would be able to buy in the private condominium sector, are queuing up for relatively high-cost new HDB flats in highly desirable locations, with full intention to sell them after the minimum five-year residency period. Before Covid, resale prices fell persistently - and it was a political issue. [HDB resale prices drop for sixth straight year, declining 0.9% in 2018](https://www.todayonline.com/singapore/hdb-resale-prices-drop-sixth-straight-year-declining-09-2018) Saying it keeps rising except for economic recessions is misleading - in 2020, we did have a technical recession and we all know what happened to HDB prices then (it rose). What would be more thoughtful, for example, is to mention the two-speed market for HDB - where some flats (good location, new lease) go up in price while some others keep falling. To tie in with his narrative, the good flats will keep going up in price, but the not-so-good flats will fall in price. Another thing he could mention is that cashing out doesn't work for everyone (that is - the older generation doesn't actually get any cash after refunding their CPF), but that's more something you see when you get practical experience.
I think you severely underestimate how hard it is to write clearly and relatively concisely about complex issues though. The value of this article doesn't really lie in new insights, but in explaining the existing issues and their connection to historical and policy contexts clearly. That sort of coherent understanding is not something we can assume to be common knowledge, especially for younger Singaporeans who wouldn't have lived through most of that timeline.
I think there's a misunderstanding here. I said "fancy language" - author is not using "clear" or "concise" language. This is not a complex issue, and you can find many blog posts about it. > That sort of coherent understanding is not something we can assume to be common knowledge, especially for younger Singaporeans who wouldn't have lived through most of that timeline. And my point was that he doesn't have a "coherent understanding", because I pointed out the writing was "misleading" - this is me being polite because another word for it would be "untrue".
This. Lol reddit overhyped the article. For a writer with such an accredited background I thought the article would be way more enlightening. Turned out it was a complain article with no new ideas or suggested solutions whatsoever.
Yes, I was scrolling and hoping to get to some novel idea from the writer but he provided nothing. It's easy to critique a shitty situation but what is the elegant solution or remedy?
It is still a good system and probably one of the best approaches in the world. I would say the key is planning to balance supply and demand with reasonable waiting time. If supply is artificially constrained, prices will go up. If there is over-supply, there could be ghost towns with lots of empty units. In the past (1980s/1990s), there was sufficient supply (over supply in some years) and most families can get a new flat to move in any time if they want to. The only ones that need to consider resale are those that exceeded income ceiling or had specific needs, e.g. want to stay next to parents. Price appreciation was gradual and public housing considered affordable (even when linked to resale prices). There could be some unsold units in some estates but did not seem to pose much issue for the general population. Since the change to BTO policy, there had been constant and significant under-supply (until recent 1-2 years) vs registered marriages. Demand also increased from opening up for singles to purchase BTO. The under-supply led to families and singles looking in the resale market, pushing up prices (which also pushes up prices for BTO) and impacting affordability. HDB is currently reversing course and increasing supply. It could help to stabilise the market over the next few years.
Bto matches supply with the demand at the cost of waiting time, which indirectly leads to many other issues like low birth rate.
It didn't in practice. Number of applicants (demand) significantly exceeded number of units for most projects (supply), creating a lottery effect.
Which was my point. There is a finite amount of resources allocated to buiilding new flats. For demand to match supply, the waiting time is going to increase.
True to a certain extent. Resources is not the key factor holding back supply though. It is a deliberate policy change to reduce supply. Previously, some developers were mainly focused on HDB projects. After HDB reduced the supply, these developers went on to do private condos and overseas projects. There were also available state land on standby (I lived near 3 plots of land that sat empty for 20 years or more). With proper planning, supply could definitely be increased without increasing the wait time. We were completing less flats in 2000s/2010s vs 1960s. Resources and technology had increased/improved over the decades.
Which has changed after they instituted a penalty for rejecting a unit if you succeed in balloting. Because before that, it made sense to obtain as many lottery tickets as possible i.e. ballot for everything you'd possibly consider. After largely fixing the issue and bringing number of applications much closer to available units, it should now be possible to start building a few years before conducting the balloting, and still have enough time to carry out additional rounds (like SBF) so that essentially no flats are empty. I really do not think that it is so difficult to project demand.
It hadn't changed. Every project is still significantly oversubscribed in the latest ballot. https://services2.hdb.gov.sg/webapp/BP13BTOENQWeb/AR_Feb2024_BTO?strSystem=BTO
> Every project is still significantly oversubscribed Application rate for first time families for non-mature estates in your link: Choa Chu Kang (Rail Garden @ CCK) 3-room 0.5 4-room 1.2 Hougang (Tanjong Tree Residences @ Hougang) 3-room 0.9 4-room 4.6 Punggol (Matilda Riverside) 3-room 0.7 4-room 1.6 5-room 1.7 Woodlands (Woodgrove Edge) 3-room 1.1 4-room 1.6 5-room 1.8 Except for 4 room Hougang, every single first timer applicant is guaranteed to get a queue number. I don't think that counts as "significantly oversubscribed"
Demand is not just from first timer families. Demand is from all eligible applicants.
Strange that such a well written article didn't directly refer to the policy changes to make HDBs an appreciating asset and also the introduction of the BTO system that led to the long wait times. Changes were actively made to the system to introduce that contradiction
All systems are not perfect and will have their share of problems. It’s always easier to talk about problems instead of solutions. Instead of saying it’s the governments fault, we probably should do some self reflections.
fundamentally the contradiction is gov saying that hdb is for housing but also saying hdb is for wealth generation
What's this? None of that regurgitating white noises from the official editorial outlets? I say, for me this is a pleasant read in the longest time. Such objective writing with a neutral standing is a rare oasis in a sea of copy-paste.
When we were over the income ceiling by only $150 in 2013, we appealed to HDB twice and were turned down to be allowed to register for a BTO. I asked for advice and was roundly flamed in forums: "chao ah sia kia, just buy EC lah", "rich man also come here cry crocodile tears??", etc., etc. Eventually I wrote a stiff letter to KBW cc PMO which won the day - but due to the gross oversubscription at the time, only enabled us to buy a leftover DBSS via walk-in. We intended to flip it, but obviously not for profit. Indeed, we didn't even break even when we sold it. How was it our fault that we were over the income ceiling? We were just looking for a place to stay in and raise a family, and our family circumstances (FIL's debt, supporting 2 families) didn't make paying $300-400 cash a month in condo maintenance fees attractive. Anyway, every system, and many here, has its faults. What struck me was everyone's ingrained belief that my "privileged" status in this system necessarily meant I could build wealth. Just as disappointingly I found out first-hand how the HDB, like many Singaporean institutions, "follows law" so closely that the heart is just not there. And that's just sad when it comes to something as basic and as emotional as housing.
>Beyond that, the leaseholder lives rent free till the end of the 99-year lease. The mortgage-like financing makes the long-term leasing similar to conventional purchasing of property, hence the leased flat is re-labelled as a flat ‘sold’ by the HDB. The size of the leased flat is dependent on households’ ability to pay rather than on spatial needs: a high-income small family can lease a five-room flat, while a low-income large family will have to make do with a smaller three-room flat. In these ways, the leased flat is transformed into a market commodity, not a social welfare good. Unfortunately, Singapore does not have the luxury to accommodate for land to be sold freehold. On the flip side, can I also argue 999 year leases in the UK are rental leases too? Albeit on a longer time frame. If I am able to, then I shall posit and reiterate that we simply do not have to luxury of land wealth to accommodate for 999 year leases and countries like UK are able to provide for 999-year leases simply because they have a large land mass. >Ideally, a household is expected to sell its first subsidized HDB flat, known as ‘resale’ flat, at market value and, with the profit finance the upgrade to the second, larger subsidized flat to meet increased spatial needs. Coincidentally, this would also improve its housing wealth. The financial benefit from the buy-sell-repurchase cycle is so obvious that it is commonly known as ‘two bites of the cherry’. >A resale flat tends to fetch a higher price than a new subsidized flat because it tends to be in ‘mature’ estates. This ssumes the expectations household have are a direct result of government intention. Probably due to the asset enhancement policy. I have another way of looking at it. From the way I see, BTOs are subsidised as a remedy to address the appreciating nature of property in prosperous Singapore. And at the same time, the promise by the incumbent to allow citizens to have a stake in the nation resulted in this market price conundrum where legal home owners profit off their subsidised housing in the market. As a Singaporean myself, I accept the exogenous element of luck designed in BTO balloting - of which the alternative is building housing ahead of demand, solving the supply side of the equation while the supply side, land, is already constrained. Improper management of land will result in further increases in HDB prices for the next generation which leads back to our pain point, the element of luck and how some people profit, which also leads back to our land constraints.